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Chinese Rout Abates as Stocks in Asia Trade Mixed: Markets Wrap

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(Bloomberg) — Asian stocks traded mix as Japanese equities declined after a holiday, while a sudden sell-off that sent Chinese equities plunging on Thursday fizzled. The dollar was modestly firmer and the euro maintained gains as the economy picked up momentum.

With U.S. markets closed and most American investors out for the Thanksgiving holiday, traders in Tokyo are back at their desks facing losses — the yen has strengthened since Japanese shares last traded. Both the Topix index and the Nikkei 225 Stock Average declined. The Hang Seng Index advanced with Chinese stocks traded in Hong Kong climbing.

The severity of Thursday’s slump in Chinese stocks caught some traders off-guard and left some questioning why authorities decided not to step in this time as they have often done in the past.

Global stocks are heading into the final weeks of 2017 at record highs as investors place their faith in economic growth and an earnings’ expansion. Thursday’s selloff in Chinese shares, which triggered a 1 percent slump in Hong Kong’s Hang Seng Index, was a reminder to international investors that turbulence in mainland Chinese markets can spread.

The euro-area economy gathered pace in November to stay on track for its best annual performance since the financial crisis, data showed Thursday. Supported by ultra-low interest rates and asset purchases from the European Central Bank, the bloc has seen unemployment drop from a record and is enjoying its most synchronized expansion since before the single currency was founded. Still, minutes from the central bank’s last policy meeting showed ECB policy makers argued against putting an end date to its bond-buying program.

South Korea’s consumer confidence rose to a near seven-year high as the economic outlook improved and geopolitical tensions eased. The won has advanced 5 percent this quarter.

Terminal subscribers can read our Markets Live blog.

Here are some key events scheduled for the remainder of the week:

  • Taiwan GDP data.
  • November preliminary U.S. Markit manufacturing and services PMIs.

These are the main moves in markets:

  • The Topix lost 0.4 percent as of 10:51 a.m. in Tokyo. The Nikkei 225 fell 0.5 percent. 
  • Australia’s S&P/ASX 200 Index decreased 0.3 percent.
  • The Hang Seng Index rose 0.6 percent and the Hang Seng China Enterprises Index of Chinese stocks traded in Hong Kong jumped 1 percent after a 1.9 percent slide on Thursday.
  • The Shanghai Composite Index was down 0.2 percent.
  • S&P 500 Index futures were little changed.
  • The Bloomberg Dollar Spot Index was little changed. It’s on course for a 0.7 percent drop this week as it heads for its third weekly loss.
  • The yen fell 0.1 percent to 111.34 per dollar. It was at 112.10 a week ago.
  • The euro was steady at $1.1850.
  • The pound traded at $1.3302.
  • The yield on 10-year Treasuries was up one basis point to 2.33 percent.
  • Australia’s 10-year yield fell one basis point to 2.49 percent.
  • West Texas Intermediate crude advanced 0.8 percent to $58.42 a barrel, the highest in more than two years.
  • Gold was little changed at $1,292.16 an ounce.

Source

https://www.bloombergquint.com/global-economics/2017/11/23/japan-stocks-set-to-drop-china-slide-in-focus-markets-wrap

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